How Long Does Bankruptcy Take?

Have you been struggling with debt problems for a long time?  If so, making the decision to file for bankruptcy relief is a big step. Many people, once they make the decision to file bankruptcy, want to get it done as soon as possible so they can get on with their lives free from the burden of unmanageable debt.  Therefore, one of the most common questions we are asked is, “When will my bankruptcy be over?”

Chapter 7 Bankruptcy

Cases filed under Chapter 7 of the Bankruptcy Code are also known as “liquidation” or “straight” bankruptcy cases.  In a Chapter 7 case, a bankruptcy trustee evaluates the debtor’s assets to determine if any of the assets have non-exempt equity.  If an asset has equity that is not protected by a bankruptcy exemption, the trustee may liquidate the asset and use the funds to pay the debtor’s creditors on a pro-rata basis.  Almost all Chapter 7 cases filed in Texas are no-asset cases. In a no-asset case, the debtor usually retains all of his or her property. A debtor will receive a discharge, or elimination, of his or her debts in approximately 3-1/2 months after filing, and the case will be subsequently closed. A no-asset case is usually closed 4 to 5 months after the date the case was filed.

Chapter 13 Bankruptcy

Cases filed under Chapter 13 of the Bankruptcy Code are also known as “an adjustment of debts of a person with regular income”. This type of case is usually used to stop a foreclosure, stop repossession of a vehicle, or to pay a non-dischargeable IRS debt. In a Chapter 13 case, the debtor proposes a bankruptcy plan outlining how his or her various creditors will be treated in the bankruptcy. The debtor makes monthly payments to a Chapter 13 trustee and the trustee disburses those payments according to the terms of the confirmed bankruptcy plan. The length of the bankruptcy case is based on the length of the bankruptcy plan. Most plans require the debtor to make payments for 60 months; however, depending on the debtor's income, the case may be as short as 36 months in length. Once all payments are made to the trustee, the trustee will complete a final accounting and the case will be closed.

If you are struggling with debt, contact Michael P. O'Donnell, attorney at law, to discuss your bankruptcy options. You have choices for dealing with your financial problems and I will help you find the solution that is best for you. As an experienced and dedicated Fort Worth bankruptcy attorney, I can offer advice on how to proceed based on your specific situation. You and I can meet face to face to discuss your options. I look forward to helping you become debt free. To schedule a FREE consultation, please contact me at (817) 732-7590 or (972) 819-3861.  You can also send me an E-mail or complete the Free Case Evaluation.